Only financial management systems (see below definitions) should be included in FMSI. Federal financial management systems generally fall into two categories (1) core financial systems or (2) mixed systems which are described in more detail under "Definitions" section below. Your agency's inventory should include both types, if relevant to financial management or financial/cost reporting. Agency FMSI submissions must also include information on the applications within each system, further defined below. The basis for agency 2009 updates should be previous FMSI submissions (which agencies can view and updated online).

The systems in FMSI should align with the financial management systems that are included within the Information Technology System Portfolio (Exhibit 53) and Capital Asset Plans and Business Case (Exhibit 300) of your agency’s A-11 budget submission. Specifically, there is a financial management system listed in the FMSI inventory it should also be listed in Exhibit 300 (and vice versa).

Definitions

These system definitions align with the updated OMB Circulars A-127, Financial Management Systems, and A-11, Preparation, Submission and Execution of the Budget.

Financial Management System includes the core financial systems and the financial portions of mixed systems necessary to support financial management, including automated and manual processes, procedures, and controls, data, hardware, software, and support personnel dedicated to the operation and maintenance of system functions.

Mixed Financial System is an information system that can support both financial and non-financial functions. The financial portions of procurement systems, loan systems, grants systems, payroll systems, budget formulation systems, billing systems, and travel systems could be examples of mixed systems.

Core Financial System is an information system that may perform all financial functions including general ledger management, funds management, payment management, receivable management, and cost management. The core financial system is the system of record that maintains all transactions resulting from financial events. It may be integrated through a common database or interfaced electronically to meet defined data and processing requirements. The core financial system is specifically used for collecting, processing, maintaining, transmitting, and reporting data regarding financial events. Other uses include supporting financial planning, budgeting activities, and preparing financial statements. Any data transfers to the core financial system must be: traceable to the transaction source; posted to the core financial system in accordance with applicable guidance from the Federal Accounting Standards Advisory Board (FASAB); and in the data format of the core financial system.

Applications within a system are the interrelated components of the system designed to support one or more financial functions and feature a common data base, common data element definitions, standardized processing of similar types of transactions, and common version control over software. For example, a payroll system may include separate applications for time and attendance, labor distribution, and pay computation.